📊 BWA Key Takeaways
Is Borgwarner Inc. (BWA) a Good Investment?
BorgWarner exhibits deteriorating profitability with net income declining 17.3% YoY despite flat revenue, indicating margin compression and operational challenges in the automotive parts sector. The company's negative free cash flow of -201M combined with modest interest coverage of 5.4x raises concerns about capital allocation efficiency and financial sustainability, particularly given significant debt levels relative to equity.
BorgWarner's fundamentals show a mixed profile: liquidity is solid and leverage appears manageable, but profitability is weak and earnings are declining despite flat revenue. The business remains financially stable, yet negative free cash flow and thin margins reduce the quality of current growth and limit near-term fundamental upside.
Why Buy Borgwarner Inc. Stock? BWA Key Strengths
- Solid liquidity position with current ratio of 2.07x and $2.3B in cash reserves
- Manageable leverage at 0.72x debt-to-equity with adequate interest coverage of 5.4x
- Substantial asset base of $13.8B providing operational foundation in established market
- Strong liquidity with a 2.07x current ratio, 1.70x quick ratio, and $2.31B in cash
- Manageable balance sheet leverage with 0.72x debt-to-equity and 5.4x interest coverage
- Large, stable revenue base of $14.32B provides operating scale and resilience
BWA Stock Risks: Borgwarner Inc. Investment Risks
- Negative free cash flow of -201M indicates capital expenditures ($469M) exceed operating cash generation ($268M), raising funding sustainability concerns
- Deteriorating profitability with net income down 17.3% YoY and net margin compressed to 1.9%, suggesting operational challenges or market headwinds
- Stagnant revenue growth at 0.0% YoY combined with declining earnings indicates the company faces competitive pressure or cyclical automotive industry weakness
- Low return metrics (ROE 5.1%, ROA 2.0%) suggest inefficient capital utilization relative to equity base
- Net income and diluted EPS declined year over year, indicating weakening bottom-line performance
- Low operating margin of 3.7% and net margin of 1.9% leave limited cushion against cost pressure or demand weakness
- Negative free cash flow of -$201M suggests current earnings are not converting well into cash after capital spending
Key Metrics to Watch
- Operating cash flow trends and path to positive free cash flow
- Gross margin sustainability amid potential input cost or pricing pressures
- Capital expenditure efficiency and ROI on major projects
- Free cash flow and operating cash flow conversion
- Operating margin and net income trend
Borgwarner Inc. (BWA) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.07x current ratio provides a solid financial cushion.
BWA Profit Margin, ROE & Profitability Analysis
BWA vs Automotive Sector: How Borgwarner Inc. Compares
How Borgwarner Inc. compares to Automotive sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Borgwarner Inc. Stock Overvalued? BWA Valuation Analysis 2026
Based on fundamental analysis, Borgwarner Inc. has mixed fundamental signals relative to the Automotive sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Borgwarner Inc. Balance Sheet: BWA Debt, Cash & Liquidity
BWA Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Borgwarner Inc.'s revenue has remained relatively flat over the 5-year period, with a 4% decline. The most recent EPS of $2.67 reflects profitable operations.
BWA Revenue Growth, EPS Growth & YoY Performance
BWA Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $3.4B | $158.0M | $0.73 |
| Q2 2025 | $3.6B | $224.0M | $1.03 |
| Q1 2025 | $3.5B | $157.0M | $0.72 |
| Q3 2024 | $3.4B | $50.0M | $0.21 |
| Q2 2024 | $3.6B | $204.0M | $0.87 |
| Q1 2024 | $3.4B | $206.0M | $0.90 |
| Q3 2023 | $3.2B | $50.0M | $0.21 |
| Q2 2023 | $3.8B | $204.0M | $0.87 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Borgwarner Inc. Dividends, Buybacks & Capital Allocation
BWA SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Borgwarner Inc. (CIK: 0000908255)
📋 Recent SEC Filings
❓ Frequently Asked Questions about BWA
What is the AI rating for BWA?
Borgwarner Inc. (BWA) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 78% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are BWA's key strengths?
Claude: Solid liquidity position with current ratio of 2.07x and $2.3B in cash reserves. Manageable leverage at 0.72x debt-to-equity with adequate interest coverage of 5.4x. ChatGPT: Strong liquidity with a 2.07x current ratio, 1.70x quick ratio, and $2.31B in cash. Manageable balance sheet leverage with 0.72x debt-to-equity and 5.4x interest coverage.
What are the risks of investing in BWA?
Claude: Negative free cash flow of -201M indicates capital expenditures ($469M) exceed operating cash generation ($268M), raising funding sustainability concerns. Deteriorating profitability with net income down 17.3% YoY and net margin compressed to 1.9%, suggesting operational challenges or market headwinds. ChatGPT: Net income and diluted EPS declined year over year, indicating weakening bottom-line performance. Low operating margin of 3.7% and net margin of 1.9% leave limited cushion against cost pressure or demand weakness.
What is BWA's revenue and growth?
Borgwarner Inc. reported revenue of $14.3B.
Does BWA pay dividends?
Borgwarner Inc. pays dividends, with $119.0M distributed to shareholders in the trailing twelve months.
Where can I find BWA SEC filings?
Official SEC filings for Borgwarner Inc. (CIK: 0000908255) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is BWA's EPS?
Borgwarner Inc. has a diluted EPS of $1.28.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is BWA a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Borgwarner Inc. has a SELL rating with 78% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is BWA stock overvalued or undervalued?
Valuation metrics for BWA: ROE of 5.1% (sector avg: 12%), net margin of 1.9% (sector avg: 6%). Compare these metrics with sector averages to assess valuation.
Should I buy BWA stock in 2026?
Our dual AI analysis gives Borgwarner Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is BWA's free cash flow?
Borgwarner Inc.'s operating cash flow is $268.0M, with capital expenditures of $469.0M. FCF margin is -1.4%.
How does BWA compare to other Automotive stocks?
Vs Automotive sector averages: Net margin 1.9% (avg: 6%), ROE 5.1% (avg: 12%), current ratio 2.07 (avg: 1.2).